Tencent, NetEase miss out again as Chinese government approves third round of video game licences

China’s gaming regulator has licensed a new batch of video games as the government body resumes work after a nine-month freeze, but titles from Tencent Holdings and NetEase are still absent from the list.

The State Administration of Press and Publications (SAPP) on Tuesday published a list of 93 approved titles – the first batch of domestic games the regulator reviewed this year and the third since it resumed licence approvals in December.

That put the total number of approved game titles to 257 since March last year amid a government restructuring.

Licence approvals tend to be granted in the order they are received so titles from Tencent and NetEase may still be on a waiting list.

“Overall, licence approvals are faster and bigger in number than market expectation,” said Xiang Wenqian and Gao Baowen, analysts with Shanghai-based Orient Securities, in a research note. “We are certain that the industry is turning positive.”

The latest round of license approvals include titles submitted for reviews in April last year, the analysts said.

Tencent and NetEase did not immediately respond to requests for comment.

Calls to the Chinese Communist Party’s propaganda department, which oversees the SAPP, went unanswered.

The gaming approval hiatus and crackdown on content had taken a toll on the industry, which saw its slowest revenue growth in at least a decade. Billions of dollars in market value were wiped off companies like Tencent and NetEase.

Publishers in China are required to submit games for review to authorities before they can be sold in the domestic market. That process, however, was suspended since March. The SAPP – formed in April as part of a broader government shake-up – announced in December the resumption of the games approval process.

Chinese authorities had earlier expressed concern over violent games and gaming addiction among minors, with the education ministry stating that it would “implement regulations and controls” on online games, explore an age-restriction system and reduce gameplay time by minors.

Three mainland listed companies had games in the latest batch of approved titles for release. Among these, Shanghai-based 37Games obtained the licence to publish its mobile strategy game The Great Tang Civilization.

Chinese gaming developers have introduced new measures to limit playing hours for minor users in response to the government’s concerns over gaming addiction. Tencent, for example, now allows parents to monitor the time and money their kids spend on the company’s mobile games as well as mini-games inside the WeChat messaging app.

Many firms have also ramped up efforts to publish their new titles overseas, while some independent labels have sought to reach the domestic audience via US-based personal computer game distribution platform Steam, which has an estimated 30 million users in China.